New Century Bancorp Reports Third Quarter 2012 Earnings

DUNN, N.C., Nov. 7, 2012 /PRNewswire/ -- New Century Bancorp (the "Company" NASDAQ: NCBC), the holding company for New Century Bank, today reported net income of $632,000 for the quarter ended September 30, 2012, and basic and diluted earnings per share of $0.09, compared to a net loss of ($22,000) and basic and diluted losses per share of ($0.00) for the quarter ended September 30, 2011. For the nine months ended September 30, 2012, the Company reported net income of $3.9 million, and basic and diluted earnings per share of $0.57, compared to a net loss of ($762,000) and basic and diluted losses per share of ($0.11) for the same period a year ago.

Total assets for the Company as of September 30, 2012, were $577.8 million, total deposits were $481.3 million and total loans were $386.0 million, compared to total assets of $616.5 million, total deposits of $527.1 million, and total loans of $439.4 million for the same date in 2011.

Positively impacting year-to-date 2012 results are a $2.4 million loan recovery during first quarter 2012 and a $557,000 gain on the sale of New Century Bank's Pembroke and Raeford branches to Lumbee Guaranty Bank during second quarter 2012.

"We continue to be pleased with our improving results," said William L. Hedgepeth, president and CEO of New Century Bancorp and New Century Bank. "While bolstered by the loan recovery and the gain on the sale of two branch offices, our results from operations are strong on their own. We are still focused on reducing non-performing assets and on working with customers to help them deal with the lingering impact of the recent recession. We've reduced non-interest expenses, while offering a full line of current products and services, including upgraded online services. The Company remains well-capitalized, which is the highest capital category.

"We are lending money to businesses and individuals in our communities, to not only support our customers, but in support of the overall economic health of our markets. This is one of the primary roles of a community bank.

"In August, we announced the opening of our loan production office in Raleigh, NC. We are off to a great start in meeting the lending needs of customers in Wake County and in building our customer base in this key market.

"As the quarter ended, the Federal Deposit Insurance Corporation (FDIC) released deposit market share data as of June 30, 2012, and I am pleased to report New Century maintained the number one position in deposit market share in Dunn, our headquarters city, for the tenth straight year. We congratulate our staff here on their hard work and success in developing strong, lasting deposit customer relationships."

New Century Bank has branch offices in these North Carolina communities: Dunn, Clinton, Fayetteville, Goldsboro, Lillington, Lumberton, and loan production offices in Greenville and Raleigh.

The information as of and for the quarter and nine months ended September 30, 2012, as presented is unaudited. This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, (i) statements regarding certain of our goals and expectations with respect to earnings, earnings per share, revenue, expenses and the growth rate in such items, as well as other measures of economic performance, including statements relating to estimates of credit quality trends, and (ii) statements preceded by, followed by or that include the words "may," "could," "should," "would," "believe," "anticipate," "estimate," "expect," "intend," "plan," "projects," "outlook" or similar expressions. The actual results might differ materially from those projected in the forward-looking statements for various reasons, including, but not limited to, our ability to manage growth, our limited operating history, substantial changes in financial markets, regulatory changes, changes in interest rates, loss of deposits and loan demand to other savings and financial institutions, and changes in real estate values and the real estate market. Additional information concerning factors that could cause actual results to materially differ from those in the forward-looking statements is contained in the Company's SEC filings, including its periodic reports under the Securities Exchange Act of 1934, as amended, copies of which are available upon request from the Company.

New Century Bancorp, Inc.

Selected Financial Information and Other Data

($ in thousands, except per share data)

At or for the three months ended

At or for the nine months ended

September 30, 2012

June 30, 2012

March 31, 2012

December 31, 2011

September 30, 2011

September 30, 2012

September 30, 2011

September 30, 2010

Summary of Operations:

Total interest income

$ 6,198

$ 6,325

$ 6,619

$ 7,086

$ 7,584

$ 19,142

$ 23,297

$ 25,285

Total interest expense

1,623

1,684

1,772

1,903

2,089

5,080

6,522

7,318

Net interest income

4,575

4,641

4,847

5,183

5,495

14,062

16,775

17,967

Provision for loan losses

189

(649)

(2,136)

319

2,194

(2,597)

5,900

14,366

Net interest income after provision

4,386

5,290

6,983

4,864

3,301

16,659

10,875

3,601

Noninterest income

757

1,199

626

642

643

2,582

2,176

1,975

Noninterest expense

4,170

4,648

4,216

4,574

4,114

13,034

14,531

13,842

Income (loss) before income taxes

973

1,841

3,393

932

(170)

6,207

(1,480)

(8,266)

Provision for income taxes (benefit)

341

683

1,281

333

(148)

2,305

(718)

(3,186)

Net income (loss)

$ 632

$ 1,158

$ 2,112

$ 599

$ (22)

$ 3,902

$ (762)

$ (5,080)

Share and Per Share Data:

Earnings (loss) per share - basic

$ 0.09

$ 0.17

$ 0.31

$ 0.09

$ (0.00)

$ 0.57

$ (0.11)

$ (0.74)

Earnings (loss) per share - diluted

$ 0.09

$ 0.17

$ 0.31

$ 0.03

$ (0.00)

$ 0.57

$ (0.11)

(0.74)

Book value per share

7.76

7.66

7.49

7.22

7.14

7.76

7.14

7.22

Tangible book value per share

7.72

7.61

7.41

7.14

7.05

7.72

7.05

7.11

Ending shares outstanding

6,913,636

6,913,636

6,913,636

6,860,367

6,860,367

6,913,636

6,860,367

6,913,636

Weighted average shares outstanding:

Basic

6,913,636

6,913,636

6,859,196

6,860,367

6,861,034

6,892,946

6,896,102

6,864,543

Diluted

6,914,085

6,913,636

6,859,196

6,860,367

6,861,034

6,893,064

6,896,102

6,864,543

Selected Performance Ratios:

Return on average assets

0.44%

0.83%

1.45%

0.39%

-0.01%

0.91%

-0.16%

-1.05%

Return on average equity

4.69%

8.82%

16.89%

4.80%

-0.18%

9.98%

-2.03%

-12.12%

Net interest margin

3.51%

3.63%

3.64%

3.68%

3.77%

3.61%

3.85%

3.97%

Efficiency ratio (1)

78.21%

79.59%

77.03%

78.52%

67.03%

78.31%

76.68%

69.41%

Period End Balance Sheet Data:

Loans, held for sale

$ -

$ -

$ 1,552

$ -

$ -

$ -

$ -

$ -

Loans, net of unearned income

386,096

390,403

399,760

417,624

439,410

386,096

439,410

467,876

Total Earning Assets

514,767

515,397

534,057

536,390

564,928

514,767

564,928

594,425

Core Deposit Intangible

327

356

516

545

583

327

583

737

Total Assets

577,833

563,682

580,996

589,651

616,580

577,833

616,580

643,185

Deposits

481,320

471,184

489,966

501,377

527,172

481,320

527,172

548,866

Short term debt

26,195

22,953

23,301

21,877

23,850

26,195

23,850

24,138

Long term debt

12,372

12,372

12,372

14,372

14,372

12,372

14,372

14,372

Shareholders' equity

53,671

52,954

51,777

49,546

48,949

53,671

48,949

49,906

Selected Average Balances:

Gross Loans

$ 386,217

$ 396,190

$ 409,009

$ 429,642

$ 449,650

$ 397,099

$ 458,676

$ 487,847

Total Earning Assets

518,761

514,147

535,317

559,110

578,349

520,492

582,777

604,379

Core Deposit Intangible

339

379

533

569

602

415

640

794

Total Assets

569,048

563,850

585,249

608,118

625,768

572,482

629,372

646,134

Deposits

474,069

471,829

495,649

518,508

534,271

480,492

537,884

548,483

Short term debt

24,609

22,961

23,004

23,476

24,491

24,018

22,075

21,178

Long term debt

12,372

12,372

13,845

14,372

14,372

12,372

16,372

16,920

Shareholders' equity

53,619

52,783

50,300

49,486

49,855

52,239

50,299

56,026

Asset Quality Ratios:

Nonperforming loans

$ 18,613

$ 16,579

$ 19,270

$ 19,636

$ 20,116

$ 18,613

$ 20,116

$ 9,678

Other real estate owned

2,849

3,859

2,391

3,031

3,230

2,849

$ 3,230

3,812

Allowance for loan losses

8,588

8,510

9,568

10,034

10,338

8,588

$ 10,338

8,081

Nonperforming loans (2)to period-end loans

4.82%

4.25%

4.82%

4.70%

4.58%

4.82%

4.58%

2.07%

Allowance for loan losses to period-end loans

2.22%

2.18%

2.39%

2.40%

2.35%

2.22%

2.35%

1.73%

Delinquency Ratio (3)

0.47%

0.77%

0.23%

1.02%

0.93%

0.47%

0.93%

1.23%

Net loan charge-offs to average loans

-0.42%

-0.42%

-1.64%

0.68%

1.92%

-0.42%

-0.37%

4.56%

(1) Efficiency ratio is calculated as non-interest expenses divided by the sum of net interest income and non-interest income.